- ADES, oil and gas drilling company, has garnered orders totaling SR286.9 billion ($76.5 billion) for its initial public offering (IPO) valued at $1.2 billion, as reported by Bloomberg. The Saudi Arabian firm has set the IPO price at $3.6 per share, which falls at the upper end of the range initially announced earlier this month. At this pricing, ADES, backed by Saudi Arabia's sovereign wealth fund, the Public Investment Fund (PIF), attains a valuation of $4.1 billion.
- In a market that has remained relatively stable compared to the previous year, the level of demand signals strong interest in the IPO, with a subscription rate exceeding 63 times the offered shares. As part of the offering, ADES is releasing 237.1 million new shares, while its existing shareholders, including PIF, ADES Investments, and Zamil Group Investment, are divesting approximately 101.6 million shares. This IPO constitutes the sale of 30% of the company.
Why it matters
ADES made its debut on the London Stock Exchange in 2017. In 2021, PIF and Zamil Group Investment, in collaboration with ADES Investments, partnered to take the company private, valuing it at $516 million during that period. Presently, the company operates in seven countries with a fleet of 85 rigs, and its primary clients include Aramco, Kuwait Oil Company, and North Oil Company in Qatar. ADES intends to utilize the proceeds from the IPO to fuel its growth, reduce a portion of its debt, and for various general corporate purposes.